Twenty One

Good morning/ evening
 
No it is not my birthday and most definitely not my 21st but I am taking a look at Twenty One, a Bitcoin company that will follow in Michael Saylors footsteps by launching a company that offers a yield for Bitcoin.
 

 
Who is Jack Mallers?
Jack Mallers is the founder and CEO of Zap, which is a popular wallet on the Lightning Network. He is also behind Strike which is an app that allows you to make and receive payments on Bitcoin's Lightning Network without fees. Mallers also had a role in El Salvador's adoption of Bitcoin as legal tender, helping to facilitate low cost remittances.
 
Who else is involved in Twenty one?
 
Cantor Fitzgerald, Tether, SoftBank Group and Bitfinex. Twenty one will have a public merger with Cantor Equity Partners, a Special Purpose Acquisition Company (SPAC). Once this is completed the company will trade on the Nasdaq under the ticker XXI. The company's mission is to maximise Bitcoin per share with Bitcoin native financial products offering a public stock built by Bitcoiners, for Bitcoiners as well as Pro Bitcon media content.
 
The company plans to launch with over 42,000 Bitcoin which would make it the 3rd largest corporate holder of Bitcoin.

• Bitcoin Per Share (BPS): This metric represents the amount of Bitcoin each fully diluted share holds, shifting the focus from traditional fiat earnings to Bitcoin accumulation.
• Bitcoin Return Rate (BRR): This rate measures the growth of BPS over time, providing a Bitcoin-denominated performance.

This highlights the company's commitment to Bitcoin as a foundational asset, moving away from conventional fiat-based financial measurement. It also shows that BItcoin is no longer such a high risk asset but a corporate trading asset. (Is this for the best? I sort of had the idea that Bitcoin is for the 'little' people, but mainstream adoption with ETFs bringing legitimacy to crypto also means more institutional buying).
 
The company has raised $585 million through PIPE ( Private Investment in Public Equity, which is a financing method where private investors purchase shares in a publicly traded company, often at a discount, to provide the company with capital) and convertible notes (Convertible notes are a form of debt that can be converted into equity at a later date,) with proceeds earmarked for additional Bitcoin purchases and general operations. Tether has committed to acquiring Bitcoin to match the amount raised. 'We're not here to beat the market, we're here to build a new one' says Mallers.
 
Shares of Cantor Equity Partners will continue to trade on Nasdaq under the symbol “CEP” until the closing of the Transaction. Twenty One will seek to trade after closing under the ticker symbol “XXI.”
 

Twenty One Capital’s comparison of its Bitcoin treasury plan to that of Strategy’s.  SEC
 
 
Now this strikes me (pardon the pun) as pretty similar, if not the same as what Michael Saylor is doing and although that really interests me, I just can't get my head around what happens when/if there is a bear market. If Bitcoins price drops 50/60% or more then surely they can't offer the yield that they currently do, as well as converting MS shares to buy BItcoin on a regular basis must surely dilute the stock. It just seems too easy, but perhaps it is! After all i did use Aave to borrow stablecoins to buy more Bitcoin, but then I did have to pay some interest on my loan unlike Michael Saylor and by doing this as the price of Bitcoin was going up, that more than covered any fees but more importantly I acquired more Bitcoin, so I could do that again (although I would not do it now that I think we may well be somewhere near the top). It is also another added layer of risk, as though crypto isn't high risk enough!
 
Although both Strategy and 21 interest me, I am just unsure about it, yes I hold Bitcoin so why would I even consider buying either of these? Well probably just to earn something for holding Bitcoin or I could just buy more Stacks and earn Bitcoin from that instead, for now I may just watch and see what happens. But if I had to choose between Micro Strategy (now just called Strategy) and 21 I am still unsure which one I would go for, if either perhaps just holding Bitcoin is good enough. 
 
What are your thoughts on 21 and the plan, do you think it is a good thing or a bad thing? If you had to chose either MIcro Strategy or 21 which would it be and why? As always please feel free to share your thoughts in the comments.